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PC Sales Expected to Decline for First Time Since 2001

After 11 years of growth, sales of PCs -- including notebooks, netbooks and desktops -- are expected to decline.

This revelation comes from three different researchers. In a report by IHS (NYSE: IHS) iSuppli, the researcher showed that worldwide PC shipments will contract this year by 1.2 percent to 348.7 million units. In 2011, 352.8 million units were shipped.

In another report, IDC found that worldwide PC sales declined by 8.6 percent in the third quarter. In the United States alone, shipments declined by 12.4 percent. Gartner (NYSE: IT) published similar results.

"There was great hope through the first half that 2012 would prove to be a rebound year for the PC market," Craig Stice, senior principal analyst for computer systems at IHS, said in a company release. "Now three quarters through the year, the usual boost from the back-to-school season appears to be a bust, and both AMD and Intel's third-quarter outlooks appear to be flat to down. Optimism has vanished and turned to doubt, and the industry is now training its sights on 2013 to deliver the hoped-for rebound. All this is setting the PC market up for its first annual decline since the dot-com bust year of 2001."

Gartner concurred with this assessment.

"Retailers were conservative in placing orders as they responded to weak back-to-school sales," said Mikako Kitagawa, principal analyst at Gartner, who also quoted in a company release. "By the end of September, retailers were focused on clearing out inventory in advance of the Windows 8 launch later this month. On the professional side, there was minimum impact from Windows 8 in the quarter because the professional market will not adopt Windows 8 PCs immediately after the release."

"PCs are going through a severe slump," added Jay Chou, a senior research analyst with IDC's Worldwide PC Tracker. "The industry had already weathered a rough second quarter, and now the third quarter was even worse. A weak global economy as well as questions about PC market saturation and delayed replacement cycles are certainly a factor, but the hard question of what is the 'it' product for PCs remain unanswered. While Ultrabook prices have come down a little, there are still some significant challenges that will greet Windows 8 in the coming quarter."

Dell (NASDAQ: DELL) and Hewlett-Packard (NYSE: HPQ) are among the biggest companies enduring declines. In the third quarter, Gartner said that Hewlett-Packard declined by 16.4 percent worldwide while Dell dropped 13.7 percent. In the United States, the declines were even greater.

Domestically, Apple (NASDAQ: AAPL) suffered as well. While the company released a brand-new version of the MacBook Pro and knocked $100 off the 13-inch MacBook Air, Apple still experienced a decline of 6.1 percent.

IDC's numbers are nearly on par with Gartner's, but there is one exception: IDC's research shows that Apple declined by seven percent.

IHS iSuppli did not provide any specific details regarding how individual corporations are performing.